AUD/USD Weekly Price Forecast – Australian dollar continues to find support after falling

The Australian dollar fell during most of the week but found a bit of support at the same area we have seen recently, the 0.72 level. The downtrend line that had been intact for so long has been broken, and it now looks as if it may offer support.
AUD/USD weekly chart, December 10, 2018

The Australian dollar has fallen during most of the week but has found support at the crucial 0.72 level. The fact that it has broken above a major downtrend line and held above there is a bullish sign. I think this is due to the US and the Chinese calling a bit of a “cease-fire” in the trade war. I think we probably go back and forth more than anything else for the rest of the year, perhaps with a slightly upward bias. However, headlines will move this pair rather drastically, and I would also point out that the 0.7250 level is essentially “fair value” in this market.

AUD/USD Video 10.12.18

If we can break above the 0.75 handle, then it allows the market to go much higher. At that point, it’s likely that the market could go as high as 0.7750 but I don’t think it happens unless we get some type of serious traction in the negotiations between the Americans and Chinese. If things deteriorate, then we probably break down to the 0.70 level which is massive support. Breaking down below there could send this market as low as 0.68. That would almost certainly be due to some type of negativity between the Americans and the Chinese, almost nothing to do with anything related to Australia directly. Overall, this is a market that I think continues to be choppy, but I believe that there are buyers waiting underneath.

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